Chicago Board Options Exchange CEO Resigns After Failing to Disclose Personal Relationships with Colleagues

The Chicago Board Options Exchange (CBOE) is one of the largest options exchanges in the world, which recently saw its CEO, Edward Tilly, resign after he failed to disclose personal relationships with colleagues. Tilly had been with the company for over 30 years and had been CEO since 2013. His sudden resignation has raised many questions about the company’s culture, governance, and leadership.

Background

The Chicago Board Options Exchange (CBOE) was founded in 1973 and is one of the largest options exchanges in the world. It offers trading in options on individual equities, exchange-traded funds (ETFs), and index options, among other financial products. The exchange is known for its innovative products, including the VIX, which is a measure of market volatility.

Edward Tilly had been with the company for over 30 years, starting as a clerk in the trading pit and working his way up the ranks. He became CEO in 2013, taking over from William Brodsky. Under Tilly’s leadership, the exchange has grown and expanded its product offerings, including the introduction of bitcoin futures trading in 2017.

The Scandal

The scandal that led to Tilly’s resignation came to light in August 2021 when the CBOE received a letter alleging that Tilly had engaged in a romantic relationship with a colleague and failed to disclose it to the board. The letter also alleged that Tilly had a history of inappropriate behavior with female employees.

The CBOE launched an investigation into the allegations, which uncovered that Tilly had indeed engaged in a romantic relationship with a colleague. The investigation also found that Tilly had failed to disclose the relationship to the board, as required by the company’s code of ethics and conduct.

The CBOE board held a special meeting in September to discuss the findings of the investigation and Tilly’s future with the company. Tilly offered to resign, and the board accepted his resignation. In a statement, the board said that Tilly’s failure to disclose the relationship “constituted a violation of the company’s policies and values and diminished his ability to lead the organization.”

Reactions

The news of Tilly’s resignation has been met with mixed reactions. Some industry insiders have praised the CBOE for taking swift action to address the issue, while others have criticized the board for not doing enough to prevent the situation from occurring in the first place.

In a statement, CBOE Chairman Ed Provost said, “We are committed to maintaining a culture of integrity, transparency, and respect, and we will continue to take all necessary actions to ensure that our employees feel safe and valued.”

However, some critics have pointed out that the CBOE has a history of issues related to sexual harassment and discrimination. In 2018, the company settled a lawsuit brought by a former employee who alleged that she was subjected to unwanted sexual advances by male colleagues and that the company did nothing to stop it.

The Future of CBOE

Tilly’s departure has left many wondering about the future of the CBOE. The company has not yet announced who will be taking over as CEO, and it remains to be seen how the scandal will impact the exchange’s reputation and business.

Some industry experts believe that the CBOE will need to take additional steps to address issues related to workplace culture and diversity. The exchange has already implemented new policies designed to prevent sexual harassment and promote inclusion, but it may need to do more to regain the trust of its employees and the broader financial community.

Conclusion

Edward Tilly’s resignation as CEO of the Chicago Board Options Exchange (CBOE) after failing to disclose a personal relationship with a colleague has raised many questions about the company’s culture, governance, and leadership. While the CBOE has taken swift action to address the issue, some critics have pointed out that the exchange has a history of issues related to sexual harassment and discrimination. The future of the CBOE remains uncertain, but it is clear that the organization will need to take additional steps to address workplace culture and diversity issues to regain the trust of its employees and stakeholders.